In the long-running IP battle between Mattel Inc., the makers of Barbie dolls, and MGA Entertainment Inc., the makers of rival Bratz dolls, a California federal court has issued a decision this week that appears to put a nail in the Bratz coffin. The court dismissed MGA’s application to reduce the $100 million damage award granted to Mattel Inc. and went further. The court also implemented the order which bars MGA from making or selling the Bratz dolls. A temporary receiver was also appointed to oversee MGA’s business. The end of the battle appears to be near, through Bratz may still have some fight left. The dispute arose after a designer, while he was under contract with Mattel, designed the Bratz concept, then secretly sold the concept to MGA. The dispute centred on copyright and intellectual property claims that ultimately put the Bratz designs back into the possession of Mattel.
The lessons for business? MGA obviously knew what it was doing, but to avoid the risk of inadvertently importing intellectual property belonging to a competitor, consider special clauses in employment and contractor agreements that can help mitigate the risks of hiring employees or contractors who bring trade secrets or IP with them when they join your company.
